Ghinger v. Pearson, 165 Md 273
Initial case brought against the Bank Commissioner of Maryland, John J. Ghingher, and the Baltimore Trust Company, due to the enactment of the Emergency Banking Act of 1933. The plaintiffs argued that certain sections of this act were “unconstitutional” per the U.S. Constitution and the Maryland Constitution. The Mayor and City Council joined the suit as a party interested in the outcome of the case. The verdict favored the plaintiffs in part and the defendants in part.
Three cases from one.
Filed in Baltimore City Circuit Court No. 2, Argued and Advanced April Term 1933 but filed in October Term 1933, under Craven P. Pearson and Horace E. Wennagle, Complainants v. John J. Ghingher,
Bank Commissioner of Maryland, and The Baltimore Trust Company (a banking institution incorporated under the laws of Maryland), Defendants. From this case came 3 appeals. Filed May 4, 1933, in the
Court of Appeals of Maryland: No. 14, John J. Ghingher, Receiver of the Chesapeake Bank of Baltimore vs. Craven P. Pearson et al.; No. 15, Mayor and City Council of Baltimore vs. Craven P. Pearson
et al.; and No. 16, Craven P. Pearson et al. v. John J. Ghingher, Bank Commissioner of Maryland, et al. Cases 14 and 15 were affirmed and No. 16 reserved for reargument.
Trial Court Records:
BALTIMORE CITY CIRCUIT COURT
NO. 2 (Equity Docket A, Miscellaneous) Pearson and Wennagle v. John J. Ghingher and The Baltimore Trust Company, October Term 1933, case No. 18961A, Volume 42A pp 100-101 and 117 [MSA T996-42, 0/62/14/13]
BALTIMORE CITY CIRCUIT COURT
NO. 2 (Equity Papers A, Miscellaneous) Pearson et al. v. Ghingher et al., 1933, Box 1803 Case No. 18961 A [MSA T56-1752, 3/24/8/43]
Appellate Court Records:
COURT OF APPEALS (Docket) Ghingher
v. Pearson, Mayor and City Council v. Pearson, and Pearson v. Ghingher, October Term 1933 Nos. 14, 15, and 16, Volume JAY pp. 3-4, MdHR 19,494 [MSA S412-19 1/67/6/5]
COURT OF APPEALS (Miscellaneous
Papers) Ghingher v. Pearson, October Term 1933 No. 14, MdHR 708-87, [MSA S397-90 1/65/7/28]
COURT OF APPEALS (Opinions) Ghingher
v. Pearson, Mayor and City Council v. Pearson, and Pearson v. Ghingher, October Term 1933 Nos. 14, 15, and 16, MdHR 707-239, [MSA S393-225 1/65/14/75]
COURT OF APPEALS (Records and Briefs)
Ghingher v. Pearson, Mayor and City Council v. Pearson, and Pearson v. Ghingher, October Term 1933 Nos. 14, 15, and 16, [MSA S1733-902 1/66/2/82]
Other Records:
Baltimore City Law Department case files no. 60,660 and 60,737 - BCA RG 13
Scanned as msaref 5458-51-3506
PROCEDURAL
POSTURE:
Defendants, receiver, mayor, and city council, and plaintiff
depositors appealed a decree from the Circuit Court No. 2 of
Baltimore City (Maryland), praying the court to declare certain
provisions of the Emergency Banking Act to be unconstitutional and
seeking to enjoin the withdrawal of funds from banking institutions
under the challenged provisions.
OVERVIEW: In response
to the exigencies of the banking crisis, the state passed the Act to
place the business of banking institutions under control by
restricting withdrawals from deposits and providing a plan for
rehabilitation of certain institutions. Specified deposits of public
money were exempted from the Act's restrictions on withdrawals. In an
action by the depositors whose rights were deferred under the Act,
the court, after reargument, affirmed in part and reversed in part
the decree. The exemption of one of a class of depositors from a
common contractual risk increased by the degree of the discrimination
the burden of the others of the class. The inequality occasioned by
giving a priority of payment to one of a class of depositors was an
impairment of the right to an equality of payment on the part of the
deferred depositors of the class, and of those whose rights of
priority or of property were impaired. The preference created for the
benefit of the state by the act impaired the obligations of contracts
and deprived depositors of their property rights without due process
of law and, therefore, was invalid.
OUTCOME: The court
affirmed in part and reversed in part the decree.
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